Carney Won’t Rule Out Retaliation Over New U.S. Tariff Threat

Ottawa – In a brief press conference on Tuesday, Prime Minister Mark Carney made it clear that Canada is not closing any doors when it comes to responding to the United States’ fresh tariff threat. He said the government will "do whatever it takes" and will look at every lever at its disposal if the 50 percent levy on a basket of Canadian products takes effect.

The new duties, announced by President Donald Trump on Monday, are being levied under Section 338 of the Tariff Act of 1930. They target a range of items—including certain dairy products, alcoholic beverages and some automotive parts—that Washington claims Canada has been treating unfairly. The tariffs are slated to kick in on August 19, giving businesses roughly a month to brace for impact.

Carney, who spoke to reporters on Parliament Hill, stressed that the timetable is tight but not a surprise. "We have a situation where the American tariffs will come into effect in 29 days, and we will look at all options in terms of how we would respond if they do come into effect," he said, pausing before adding, "When I say we will do whatever it takes, I mean we’re keeping every option on the table – diplomatic, legal, economic – you name it."

He also noted that talks with Washington have already stepped up. "I spoke with President Trump this morning, and we agreed to intensify negotiations in the coming weeks," Carney told the press. The prime minister said Trade Minister Dominic LeBlanc will convene the Canada‑U.S. Advisory Council later that day, while provincial premiers will join a conference call to discuss the fallout and coordinate a unified response.

While the new 338 tariffs do not touch sectors like potash, energy, or fish – which already face separate duties – they will apply to goods that meet the standards of the Canada‑U.S.–Mexico Agreement (CUSMA). Carney reminded the audience that Canada has been pushing for a modernized CUSMA that reflects shifting trade realities, especially around the United States’ own Section 232 measures on aluminum, steel, forest products and automobiles.

"Our sticking point remains those Section 232 tariffs," Carney said. "Those first four sectors are the backbone of our economy, and we won’t settle for a partial deal that leaves them exposed." He argued that any agreement must address those industries comprehensively, otherwise it won’t be sustainable.

Trump, speaking to reporters in the Oval Office, fired back, saying Canada has been “very tough” on the United States for years and that no previous president has taken strong action. He suggested the tariffs are a necessary response to what he described as Canadian protectionism.

Back in Ottawa, Carney’s tone was measured but firm. He acknowledged the pressure the tariffs place on Canadian farmers, brewers and auto parts makers, yet he urged patience, noting that “intensified negotiations” could potentially defuse the situation before the August deadline.

The next few weeks will likely see a flurry of diplomatic activity: bilateral talks, possible World Trade Organization consultations, and, if necessary, a coordinated response from the provinces. For now, Carney’s message is clear – Canada is watching, waiting, and ready to act, whatever form that action may take.